ITV ad revenue decline eases slightly in second quarter

ITV: ad revenue declined by 8% in first half
ITV: ad revenue declined by 8% in first half

ITV's TV ad revenue declined by 7% year on year between March and June 2017, although that was a slight improvement on the 9% decline reported in the first three months.

ITV’s family of channels generated TV ad revenue of £769m in the first six months of 2017, down 8.2% year on year, which ITV attributed to "continued economic and political uncertainty" in the UK.

Overall, group external revenue also declined, down 3% to £1.46bn in the six months to 30 June 2017 as the 7% revenue boost at production arm ITV Studios to £697m failed to compensate for the falls in the ad business.

The broadcast and online division – which includes ad revenue – fell by 5.7% to £1bn.

ITV said its broadcast business remains "robust". The ITV family of channels’ share of viewing was flat over the six months, while online viewing rose 34%.

ITV2’s share of commercial impacts (SOCI) among 16- to 34-year-olds rose 15% year on year in the first half, which only includes part of the boost the channel has received from summer smash hit Love Island.

In its interim results for the first half, ITV attributed declines in ad categories such as retail, finance and food to uncertainty on the economic outlook as well as the weakening of the pound causing inflationary pressure and leading brands to reduce adspend to prop up their margins.

The entertainment and leisure sectors’ year-on-year declines reflect tough comparisons with last year’s European football championship, ITV said.

The broadcaster reported better news from sectors including cars and car dealers, telecommunications and supermakets. ITV said digital brands also continue to spend heavily on TV to "build brand awareness".

Peter Bazalgette, ITV executive chairman, said: "Looking ahead our guidance for 2017 remains unchanged. ITV Studios has already secured 85% of expected full year revenues, over £100m more than this time last year and is firmly on track to deliver good organic revenue growth.

"We anticipate further good growth in online, pay & interactive driven by video-on-demand and pay. We expect ITV Family net ad revenue in Q3 to be down around 4%, again impacted by wider economic uncertainty and over the full year we expect to outperform the TV advertising market."

Profit before tax was £269m during the half year, a decline of 16.2% year on year.

Earlier this month ITV confirmed it had appointed easyJet chief executive Carolyn McCall as its first female chief executive, replacing Adam Crozier who announced his intention to step down in May and left the company at the end of June.

McCall – who is a former chief executive of Guardian Media Group – will start in January 2018.

Bazalgette said: "Carolyn brings a strong track record in media, experience of an international operation, clear strategic acumen and a reputation for delivering value to shareholders. We look forward to her arrival."

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